LLC vs. Trust for a Self-Directed IRA: What’s the Difference?

When setting up a Self-Directed IRA, investors often seek “checkbook control”—the ability to make investments quickly without waiting on a custodian to approve every transaction. There are two common ways to gain this level of control: through a Limited Liability Company (LLC) or a Trust. Both offer similar benefits, but there are important differences that can affect how you manage your retirement investments.

What Is Checkbook Control?

Checkbook control allows you to write checks, send wires, and make investment decisions directly from your IRA’s dedicated account structure. Instead of waiting for a custodian to process paperwork, you have the freedom to move quickly on investment opportunities like real estate, private companies, crypto, and more.

At Rocket Dollar, we offer two paths to achieve this control:

• IRA LLC
• IRA Trust

Both structures give you the ability to act as the manager of the entity that holds your IRA’s funds—but how they operate behind the scenes can be quite different.

LLC: The Traditional Checkbook IRA

Using an LLC is the most common path for checkbook control.

How it works:

Rocket Dollar helps establish a special-purpose LLC that is 100% owned by your IRA. You, as the IRA holder, are designated the manager of the LLC. The IRA funds are then sent into a business bank account in the LLC’s name, and you manage that account directly.

Pros:

• Offers liability protection for IRA-owned assets
• Widely accepted and familiar to most professionals
• Ideal for holding multiple or complex investments

Cons:

• Requires annual state filings and potentially franchise taxes
• Typically, more paperwork and ongoing compliance obligations
• Some states charge high fees for LLCs
• LLC registration is public—your entity name and filings may be searchable online

Trust: A Simpler, More Private Option for Checkbook Control

A newer, more streamlined option is to use a Trust instead of an LLC.

How it works:

Rocket Dollar helps establish an IRA Trust that is owned by your Self-Directed IRA. You serve as the trustee, managing a bank account held in the name of the trust.

Pros:

• No state registration or franchise taxes
• Less paperwork and fewer annual reporting requirements
• Quicker setup and often lower ongoing costs
• Still provides full checkbook control
• More privacy—Trusts do not require public filings or state registration, which helps keep your IRA’s investment entity out of searchable databases

Cons:

• Not as widely recognized or understood as LLCs
• May be less suitable for complex legal structures or partnerships

Privacy Consideration:

If privacy is important to you—especially when investing in sensitive deals, local real estate, or less regulated asset classes—a Trust offers an advantage. Unlike LLCs, which must be registered with the state and often appear in searchable public databases, Trusts operate quietly in the background with no state-level filing requirement. Your name and your IRA’s entity remain more discreet.

Which Is Right for You?

Both the LLC and Trust structures give you the speed and flexibility of checkbook control. The best choice depends on your investment strategy, your need for privacy, and how much administrative complexity you’re willing to handle.

Choose a LLC if you plan to hold multiple investments across different asset classes, want additional liability protection, or need a more conventional structure for partners or lenders.

Choose a Trust if you want a faster, easier setup with minimal paperwork and maximum privacy—and your investment plans are relatively straightforward.

What Customers Are Saying

“From the moment I signed up, the communication, support, and response time have been absolutely outstanding — faster than I ever expected. I’ve never had an account like this before… but your team made it easy to understand and guided me every step of the way.”
— Rod F., Rocket Dollar customer

“My experience with Rocket Dollar has been amazing. I was skeptical initially but the staff has been very responsive and helpful. I have been in contact with Tristan and he is very diligent in answering all my questions. Would highly recommend them.”
— Rocket Dollar customer

Why Rocket Dollar?

At Rocket Dollar, we’ve helped thousands of investors gain checkbook control through both LLC and Trust structures. We make the setup simple, handle the heavy lifting, and support you with a knowledgeable customer success team every step of the way.

Whether you’re investing in real estate, startups, or alternative assets, our Self-Directed IRA accounts—powered by either a LLC or Trust—give you the freedom to control your financial future.

Ready to take control of your retirement investments?

Explore our Self-Directed IRA options and see which structure fits your strategy best.

Disclaimer
Rocket Dollar, Inc. and its affiliates (collectively, “Rocket Dollar”) do not provide tax, legal, investment, or accounting advice. All marketing materials, including this content, are for general informational purposes only and should not be considered individualized recommendations or financial guidance. You should consult an independent tax advisor, attorney, financial advisor, or CPA to determine whether a Rocket Dollar account or specific investment approach is appropriate for your personal financial situation.